Italy VAT €65,000 registration threshold extended
- May 6, 2020 | Richard Asquith
Italy has been given permission by the EU Commission. to extend its VAT registration threshold for resident businesses at €65,000.
The raised threshold aims to reduce the tax and administrative burden on small enterprises, and give them a tax boost. Under the provisions of the EU VAT Directive, Italy had to seek permission to deviate from the EU VAT rules which limits the threshold across the EU27 member states to €5,000 per annum. Italy has held permission to exceed this limit since 2008 – firstly to €30,000 and then €65,000 in 2013.
It has been granted this latest derogation until 31 December 2024. The effective date is 1 January 2020.
The threshold does not apply to non-resident businesses with an Italian VAT registration threshold. The threshold is still zero.
Another exemption is foreign e-commerce sellers of B2C goods who are selling under the EU distance selling thresholds. However, this is being reformed under the 2021 e-commerce package.
Need a fiscal representative in Italy?
Non-EU businesses selling in Italy will need to appoint a fiscal representative alongside completing VAT registration and returns.
Fiscal representatives are responsible for the accurate VAT submissions of their non-EU clients.
Avalara offers a Fiscal Representative Service as part of its international VAT and GST Registration and Returns Service.
Need help with your Italian VAT compliance?
Researching Italian VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.